Reasons why the Pennsylvania Liquor Control Board should be abolished, and The Almighty Liquor Code completely overhauled and rewritten, to reflect over 80 years of change since Repeal.

Tuesday, June 21, 2011

Is Privatization Bad for your Health?

The guys at Freakonomics have always struck me as a bit too quick to jump on the anti-alcohol wagon; sure, there are valid points to be made for the social costs of alcohol abuse, but the numbers that are out there would really benefit from a closer look. But this piece was handled more fairly, I thought, even though the big quote from the Herzenberg study overweighted things a bit.

Thing is, as the comments pointed out, the whole argument that privatization increases consumption is quite likely a flawed one, based on questionable methodology: "retail purchase" is a reliable substitute for "consumption." That sounds okay, till you consider how many Pennsylvanians cross the Delaware, Maryland, and New Jersey borders to buy caselots of booze. Look, if my DAD did it, I know plenty of other Pennsylvanians are doing it. Hell, I'm in Kentucky right now, and I have four bottles of bourbon that I can't get in PA in the car (Old Fitz BiB, Heaven Hill 6 Year Old BiB, and Charter 101 (the 4th is a surprise for someone, but trust me: it's not available in PA!); I'm planning on giving them all away before I return to PA, though...).

It doesn't even pass the "straight face test," to use a popular Washington phrase. If consumption in these newly privatized states and provinces were really up by 48%...where's the corresponding increase in alcohol-related problems? Because there is none. We're being sold a sack of crap again.

3 comments:

I think you're being a little too hard on this study, Lew. Of course you're right that some people cross borders, but not enough to affect sales that dramatically.

It makes perfect sense that making something more accessible would increase sales. Ending prohibition doubled the number of drinkers, decriminalizing marijuana would mean more pot smokers, and taking alcohol sales out of the PLCB's hands would sell more booze. That's part of the point.

I think you hit on it perfectly though when you note that a rise in use does not mean a rise in abuse, though. All it necessarily means is a rise in tax revenue, which is a good thing.

If the consumption in these states is up 48% as alleged, can anyone track a similar increase in production or distribution to match these numbers? Shouldn't Diageo, AB-InBev, etc. be doing at least 25% better in these states? Or can they document a drop in "consumption" in the adjoining states--not in percentages, but in units being sold?

I think the study makes sense, but it's still no reason not to privatize.

Everybody agrees that the state store system makes booze more expensive than the true market price. So if you privatize, alcohol will be cheaper on net. When stuff gets more expensive, people buy less of it, and when it gets cheaper, they buy more of it. So it's perfectly reasonable to expect consumption to increase.

Now, the alcohol industry is not making most of its money from guys like me that have a beer or two every day. They're making most of their profits from the problem drinkers who drink a case every day. And if the price goes down, that's going to get way worse.

That's why I'm for market prices, but higher taxes to keep the price constant. A straight gallonage tax based on alcohol content would be the best option in my view.

Four new bills from the House to tear down the PLCB's Wall. What will happen to them?

Needed: passion for privatization

"...there was [in 1997] no overarching passion within the General Assembly, or in the public at large, for privatization. Unless and until there is a general hue and cry, it is very unlikely there will be a privatization initiative that succeeds." -- John E. Jones III, former PLCB chairman

If you've got your own reasons...

Send them to me. I'd love to hear from you, and take those ideas and blend them with mine. And if you're in favor of the continuing existence of the PLCB, well, send me that, too. If it makes sense, I'll publish; if it doesn't, I'll publish it also, but I may have to disagree with you.

Privatization's in play: what are your biggest concerns?

If the Legislature ignores the will of the citizens and goes the "modernization" route...what would you most like to see change with the State Stores?

Why do you buy booze in other states?

What I like most about the PLCB is:

The first thing I'd change in the Pennsylvania Liquor Code is:

When I buy wine at a Pennsylvania State Store:

When booze sales are privatized in PA, State Store clerks can be:

The wine and spirits selection at the State Stores is actually better than at the average "liquor store" in other states. This makes me feel like:

What factor is most likely to block any meaningful reform of Pennsylvania's Liquor Code?

If the legislature suddenly did away with the case law tomorrow, and any distributor, bar, or tavern could sell any amount of beer they wanted to, the most likely unintended consequence would be:

Polls show that over 80% of Pennsylvanians are opposed to the case law -- even MADD doesn't support it -- yet a six-pack sales bill still languishes in the Legislature after over a year. Why do your elected representatives continue to thwart your wishes?

What do you think of the proposed new name for the State Stores: Table Leaf?

Which PLCB gaffe really pissed you off over the past two years?

Blame the PLCB, the Legislature, or Rendell: things seem to disappear around the PLCB. Which one of these do you miss the most?

I buy beer at Pennsylvania supermarkets because:

The new wine kiosks are

The most important reason for liquor store privatization in PA is:

Why won't you write to your state reps to tell them you're in favor of privatizing the State Stores?

What aspect of the PLCB's "Anything But Privatization!" program sounds most ridiculous?

PJ Stapleton and Joe Da CEO have presided over an incredible festival of FAIL. As PA taxpayers, we are the 'shareholders' of this 'business.' How do you vote?

HB11, the current proposal for privatization, has serious flaws. How do we proceed?

Are you going to stop buying your booze in the State Stores and take privatization into your own hands?

Governor Corbett's supposed to be working on a new privatization bill. What is the most important piece of that bill for you?

Why do you think the PLCB created their house "Table Leaf" wine brand?

Will Joe Conti still be PLCB CEO by next spring?

The Pennsylvania State Stores should be replaced by:

What is your opinion on Governor Corbett's privatization plan?

If you could hit the re-set button and set up booze sales any way you like in the Commonwealth...what would you do?

How about we talk about that Police-Enforced Monopoly. Got an opinion?

When the Senate finally moves on privatization, they'll most likely

To get any privatization, we need to get a bill through the Senate, agreed to by the House, and signed by Corbett by 6/30. What's most likely?

Politics and general dysfunctionality of the Legislature has delayed a vote on privatization. Will anything happen in the brief Fall Session?

New Democratic Governor, Republican Legislature...what's that mean for liquor privatization?

The House & Senate are moving to normalization. What might Gov. Wolf NOT veto?

After The Veto...are things over?

What should the GOP majority offer Gov. Wolf in exchange for liquor normalization?